India plans massive increase in solar energy

India will launch a solar power target by September 2009, which could increase the output from almost nothing to a staggering 20GW by 2020 - in a bid to fight global warming. To put this in context, today's global PV installed capacity stands at around 14GW.

The target, which would help India close the gap on major solar players such as China, is part of a US$19 billion, 30 year scheme that will also help boost India's influence in crucial international talks for a new UN climate deal - COP 15 - in Copenhagen later this year; India's stance to date has been that it must use more energy to lift its population from poverty and that its per-capita emissions are a fraction of those in rich nations, which have burned fossil fuels unhindered since the industrial revolution.

When fully developed, India's planned solar power generation would be equivalent to around one-eighth of India's current installed power base, and would help the emitter of planet-warming greenhouse gas emissions limit its heavy traditional reliance on dirty coal, as well as pacify the nagging power deficit that has stifled its growth.

In India about 56% of the 1.1 billion-plus population do not have access to electricity. In spite of its pledge to develop clean technology, coal remains the backbone of India's power sector, accounting for about 60% of generation, with the Government planning to add 78.7 GW of coal-fired power generation during the five years ending March 2012. Of this, 15.1 GW has been commissioned.

The National Solar Mission (part of a National Action Plan on climate change) envisages the creation of a statutory solar authority that would make it mandatory for states to buy some solar power, as per the draft of the plan, which provided detailed proposals for the first time.

"The aspiration is to ensure large-scale deployment of solar generated power for both grid connected as well as distributed and decentralised off-grid provision of commercial energy services," the draft policy said.

Investment would be made on incentives for the production and installation and also for research and development, and the plan offers financial incentives and tax holidays for utilities.

The Mission envisions three phases starting with 1-1.5 GW by 2012 along with steps to drive down production costs of solar panels and drive domestic manufacturing. The move could unlock the country's renewables potential and benefit companies such as Tata BP Solar, a joint venture between Tata Power and BP plc's solar unit, BP Solar, and Bharat Heavy Electricals Ltd, a state-run power and engineering equipment firm, and Lanco Infratech.

India's Climate Plan, released in 2008, identified harnessing renewable energy, such as solar power, and energy efficiency as central to its fight against global warming. Currently around 8% of India's total power mix is from renewables, although India is a leading provider of wind power technology.

The draft policy document estimated that India could reduce about 42 million tonnes of CO2 emissions with its new solar plan, which aims to provide access to solar-powered lighting for 3 million households by 2012. The proposed plan is to make the use of solar-powered equipment and applications mandatory for hospitals, hotels and government buildings, and encourage the use of solar lighting systems in villages and small towns with micro financing.

The plan will also outline a system of paying households for any surplus power from solar panels fed back into the grid.

The National Solar Mission will add to India's bargaining power in international negotiations, although India's refusal to commit to any binding emission targets has angered many rich countries demanding greater commitment. "Such unilateral action will give India the moral high-ground because the rich countries have not committed to anything in terms of finance and technology," said Siddharth Pathak, Greenpeace India's chief climate campaigner.

India's economy has grown by 8%-9% annually in recent years, and contributes about 4% of global greenhouse gas emissions.